U3 The Debate

The Debate : 

The Debate People Who Helped Define America’s Economic Policies

Laissez-faire vs. Utopia (?) : 

Laissez-faire vs. Utopia (?) In the eighteenth century, mercantilism was challenged by the doctrine of __________ or individualism and the belief that government should not interfere in commercial affairs This new idea was introduced by _________ (1723-1790) “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own self-interest.” Smith called this concept ___________________. Adam Smith “The Invisible Hand” laissez-faire Aggregate Supply

Adam Smith vs. Karl Marx (?) : 

Adam Smith vs. Karl Marx (?) __________- took an opposite approach, he saw Smith’s “capitalism” leading to a class struggle between the __________ those who own the means of production, (the factories and the land), and the much larger_________- the working class - who actually perform the labor necessary to create valuable things for the economy. He argued for a “closed” economic system where government committees made most of the economic decisions. bourgeoisie proletariat Karl Marx Aggregate Demand

Government vs. Invisible Hand (?) : 

Government vs. Invisible Hand (?) John Maynard Keynes _________ economics contrasts with Adam’s laissez-faire economics. Keynes’ ideas promote a mixed economy, where both the ____________ and the private sector play an important role. __________ tries to bring the economy to its full capacity by means of increasing _______, primarily through _____ policy set by the government. Keynesian Public Sector Keynesianism demand Fiscal Aggregate Demand

Keynes vs. Friedman (?) : 

Keynes vs. Friedman (?) Friedman’s Monetarism – Promotes a more ___________ policy by minimizing ___________ involvement in the economy and works primarily with the supply and demand of money. ________________ - Policies enacted by ________ including performing open market operations i.e. Selling Government bonds, changing the reserve requirement, and manipulating the federal funds interest rate. laissez-faire government Monetary Policies the Fed Aggregate Supply

Freedom vs. Security (?) : 

Freedom vs. Security (?) The “Great Society” was an initiative of President _______________ that worked toward social reforms to eliminate poverty and racism. Government programs like Head Start and Job Corps where funded through government revenue/______. Civil Rights Act of 1964 and the Voting Rights Act of 1965 where enacted under LBJ. Taxes Lyndon B. Johnson Aggregate Demand

Johnson vs. Goldwater 1964 (?) : 

Johnson vs. Goldwater 1964 (?) Goldwater promoted a ____________ economic view as the Republican nominee for President in the 1964 election. He is the American politician most often credited for sparking the resurgence of the American conservative political movement in the 1960s. His defeat allowed American liberals to pass their ______________ programs. He called for the abolition of the progressive income tax, an end to Social Security. He worked to pare down the Federal Government. Great Society Conservative Aggregate Supply

The “New Deal” vs. “Reaganomics” (?) : 

The “New Deal” vs. “Reaganomics” (?) A “New Deal” was offered as a fix for the ______________ by President Franklin Delano Roosevelt. (1929-1940) The _____ stock market crash brought the nation to its knees. Employment Act of 1946 stated that the _______________ was primarily responsible for “maximum employment, production, and purchasing power”. "…more than the material gains, will be the spiritual and moral value of such work.“ - FDR Roosevelt looked to the work of economist ____________________to help shore up support for his new government funded programs. John Maynard Keynes Great Depression federal government 1929

Roosevelt vs. Reagan (?) : 

Roosevelt vs. Reagan (?) Supply-Side Economics or the trickle-down effect. Introduced by ____________ worked to reduce income tax rates of the highest income earners. Why? The top tax bracket rate dropped from 70% to 50% in his first tax legislation, and would fell to 28% by the end of his presidency. Reagan also supported economic ___________ which meant less government oversight and more freedom in the market. Reagan looked the work of economist ________________to help shore up support for his free market programs. Milton Friedman Ronald Reagan Deregulation

Obama Administration : 

Obama Administration Provide a tax cuts for working families. Eliminate all capital gains taxes on startup and small businesses. Use trade agreements to spread good labor and environmental standards around the world. Increase Social Security Tax on rich to shore up Social Security. Re-capitalize Banks to break credit crunch. Government subsidized loans to automakers.